**United          States**

**Securities          and Exchange Commission**

**Washington,          DC 20549**

**FORM          10-QSB**

**June          30, 2006**

**000-28789**

**Falcon          Ridge Development Inc.**

| **Nevada**                                                                                            |   | **84-1461919**                                            |
|-------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------|
| (State                    or other jurisdiction of incorporation)                                     |   |  (IRS                    Employer File Number)  |
|                                                                                                  |   |                                                      |
|  **5111                    Juan Tabo Boulevard N.E. Albuquerque, New                    Mexico** |   |  **80202**                                           |
|  (Address                    of principal executive offices)                                |   |  (zip                    code)                  |
|                                                                                                  |   |                                                      |

**(866)          302-2248**
** **

**Yes          [X]**

**No          [X]**

**752,262,441          shares of common stock.**

**No          [X]**

----

**TABLE          OF CONTENTS**

|                                                                                                                                                                                                                                                                      |   | **Page** |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|
| PART                    I- FINANCIAL INFORMATION                                                                                                                                                                                                                     |   |     |
|  Item                    1. Financial Statements.                                                                                                                                                                                                                    |   |     |
|       Balance                    Sheet (Unaudited) at June 30, 2006                                                                                                                                                               |   | 1   |
|      Statements                    of                    Operations (Unaudited) for the three months                            and six months ended June 30, 2006 and 2005                                             |   | 2   |
|      Statements                      of                      Shareholders' Deficit (Unaudited) for the for the three months and                      six months                             ended June 30,2006 and 2005 |   | 3   |
|      Notes                    to Consolidated Financial Statements                                                                                                                                                                               |   | 4   |
|                        Statements                    of                    Cash Flows (unaudited) , for the six months ended June 30, 2006                    and                    2005                                                        |   | 5   |
|                                                                                                                                                                                                                                                                      |   |     |
|  Item                    2. Management's Discussion and Analysis or Plan of                    Operation.                                                                                                                                                            |   | 14       |
|  Item                    3. Controls and Procedures                                                                                                                                                                                                                  |   | 18       |
|                                                                                                                                                                                                                                                                 |   |     |
| PART                    II - OTHER INFORMATION                                                                                                                                                                                                                       |   |     |
|  Item                    1. Legal Proceedings.                                                                                                                                                                                                                       |   | 19       |
|  Item                    2. Unregistered Sales of Equity Securities and Use of                    Proceeds                                                                                                                                                           |   | 19       |
|  Item                    3. Defaults Upon Senior Securities.                                                                                                                                                                                                         |   | 19       |
|  Item                    4. Submission of Matters to a Vote of Security Holders.                                                                                                                                                                                     |   | 19       |
|  Item                    5. Other Information.                                                                                                                                                                                                                       |   | 19       |
|  Item                    6. Exhibits and Reports on Form 8-K.                                                                                                                                                                                                        |   | 20       |
|  Signatures                                                                                                                                                                                                                                                          |   | 20       |

----

**FALCON            RIDGE DEVELOPMENT, INC.**

**(FORMERLY            POCKETSPEC TECHNOLOGIES, INC.)**

**BALANCE            SHEET**

**(Unaudited)**

| **Assets**                                                                |   |   |       |
|---------------------------------------------------------------------------|--------|--------|------------|
|                                                                      |   |   |       |
|                                                                      |   |   |       |
| Real                      estate held for resale                          |   | $      | 1,428,428  |   |
| Fixed                      assets, net of accumulated depreciation        |   |   | 37,432     |   |
| Cash                                                                      |   |   | 64,178     |   |
| Prepaid                      expenses                                     |   |   | —    |   |
| Other                      assets                                         |   |   | 220        |   |
| Total                      assets                                    |   | $      | 1,530,258  |   |
|                                                                      |   |   |       |   |
| **Liabilities                      and Shareholders' Deficit**            |   |   |       |   |
|                                                                      |   |   |       |   |
| **Liabilities**                                                           |   |   |       |   |
| Indebtedness                      to related parties                      |   | $      | 1,002,372  |   |
| Note                      payable, long-term                              |   |   | 379,830    |   |
| Accounts                      payable                                     |   |   | 155,062    |   |
| Retainage                      payable                                    |   |   | 100,000    |   |
| Accrued                      expenses                                     |   |   | 59,391     |   |
| Total                      liabilities                               |   |   | 1,696,655  |   |
|                                                                      |   |   |       |   |
| **Shareholders'                      deficit**                            |   |   |       |   |
| Preferred                      stock,Class A .0001 par value,             |   |   |       |   |
| 400,000                      shares authorized, 160,000 shares issued and |   |   |       |   |
| outstanding                                                               |   |   | 400,000    |   |
|                                                                      |   |   |       |   |
| Preferred                      stock,Class B .0001 par value,             |   |   |       |   |
| 400,000                      shares authorized, 166,000 shares issued and |   |   |       |   |
| outstanding                                                               |   |   | 415,000    |   |
|                                                                      |   |   |       |   |
| Common                      stock, $0.001 par value, 900,000,000 shares   |   |   |       |   |
| authorized,                      752,262,441 shares issued and            |   |   |       |   |
| outstanding                                                               |   |   | 752,262    |   |
| Additional                      paid-in capital                           |   |   | 2,185      |   |
|                                                                      |   |   |       |   |
| Accumulated                      deficit                                  |   |   | (1,735,844 | ) |
|                                                                      |   |   |       |   |
|  Total                      Liabilities and Shareholders' Deficit    |   |   | (166,397   | ) |
|                                                                      |   |   |       |   |
|                                                                      |   | $      | 1,530,258  |   |

----

**FALCON              RIDGE DEVELOPMENT, INC.**

**(FORMERLY              POCKETSPEC TECHNOLOGIES, INC.)**

**STATEMENT              OF OPERATIONS**

**(Unaudited)**

|                                                                     |   | **Three                          Months Ended** |        |     |   | **Six                          Months Ended** |   |     |        |
|--------------------------------------------------------------------------|--------|-------------------------------------------------|-------------|----------|--------|-----------------------------------------------|--------|----------|-------------|
|                                                                     |   | **June                          30**            |        |     |   | **June                          30**          |   |     |        |
|                                                                     |   | **2006**                                        |        | **2005** |   | **2006**                                      |   | **2005** |        |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |
| Lot                          sales:                                      |   |                                            |        |     |   |                                          |   |     |        |
| Net                          sales                                       |   | $                                               | —     |     | $      | 2,808,159                                     |   | $        | —     |   | $ | 5,824,945.00 |   |
| Costs                          of sales                                  |   |                                            | —     |     |   | (2,390,709                                    | )      |     | —     |   |   | (5,261,696.00 | ) |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Gross                          profit (loss)                        |   |                                            | —     |     |   | 417,450                                       |   |     | —     |   |   | 563,249 |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Selling,                          general and administrative expenses    |   |                                            | 171,978     |     |   | 174,646                                       |   |     | 264,756     |   |   | 191,490 |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Loss                          (income) before provision for income taxes |   |                                            | (171,978    | )        |   | 242,804                                       |   |     | (264,756    | ) |   | 371,759 |   |
| Income                          taxes                                    |   |                                            | —     |     |   | —                                       |   |     | —     |   |   | — |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Loss                                                                     |   |                                            | (171,978    | )        |   | 242,804                                       |   |     | (264,756    | ) |   | 371,759 |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Proforma                          adjustments:                           |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Members'                          distributions (note 2)                 |   |                                            | —     |     |   | (15,000                                       | )      |     | —     |   |   | (30,000 | ) |
| Income                          taxes                                    |   |                                            | —     |     |   | —                                       |   |     | —     |   |   | (96,918 | ) |
| Proforma                          Loss                              |   | $                                               | (171,978    | )        | $      | 227,804                                       |   | $        | (264,756    | ) |   | 244,841 |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Loss                          per share                                  |   | $                                               | —     |     | $      | —                                       |   | $        | —     |   |   | — |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |
| Weighted                          average number of shares outstanding   |   |                                            | 752,262,441 |     |   | 118,632,686                                   |   |     | 752,262,441 |   |   | 110,647,249 |   |
|                                                                     |   |                                            |        |     |   |                                          |   |     |        |   |   |   |   |

----

**FALCON              RIDGE DEVELOPMENT, INC.**

**(FORMERLY              POCKETSPEC TECHNOLOGIES, INC.)**

**STATEMENT              OF SHAREHOLDER'S DEFICIT**

**(Unaudited)**

|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |
|------------------------------------------------------------------------------------|--------|----------------------------------------------|---------|----------------------------------------|--------|-------------------------------------------|--------|----------------------------------------|-------------|-------------------------------|--------|-----------------|--------|-----------|----------|
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |
|                                                                               |   | **Preferred                          Stock** |    |                                   |   | **Common                          Stock** |   |                                   |        | **Additional****p****aid-in** |   | **Accumulated** |   |      |     |
|                                                                               |   | **Shares**                                   |    | **Par                          value** |   | **Shares**                                |   | **Par                          value** |        | **capital**                   |   | **deficit**     |   | **Total** |     |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |
| Balance                            at January 1, 2005                              |   |                                         | — |                                   | $      | —                                   |   |                                   | 100,000,000 |                          | $      | 100,000         |   | $         | 210,644  |   | $ | (882,288 | ) | $ | (571,644 | ) |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Dividend                          distribution                                     |   |                                         | — |                                   |   | —                                   |   |                                   | —     |                          |   | —         |   |      | —  |   |   | (30,000 | ) |   | (30,000 | ) |
| Merger                          with PocketSpec                                    |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Technologies,                          Inc (Note 1)                                |   |                                         | — |                                   |   | —                                   |   |                                   | 37,265,372  |                          |   | 37,265          |   |      | —  |   |   | (37,265 | ) |   | — |   |
| Stock                          issuance for                                        |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Spanish                          Trails, LLC (Note 2)                              |   |                                         | — |                                   |   | —                                   |   |                                   | 614,882,069 |                          |   | 614,882         |   |      | (210,644 | ) |   | (402,238 | ) |   | 2,000 |   |
| Compensation                                                                       |   |                                         | — |                                   |   |                                      |   |                                   | 115,000     |                          |   | 115             |   |      | 2,185    |   |   |   |   |   | 2,300 |   |
| Stock                          issuance for Cash                                   |   |                                         | 160,000 |                                   |   | 400,000                                   |   |                                   | —     |                          |   | —         |   |      | —  |   |   | — |   |   | 400,000 |   |
| Loss                                                                               |   |                                         | — |                                   |   | —                                   |   |                                   | —     |                          |   | —         |   |      | —  |   |   | (119,297 | ) |   | (119,297 | ) |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Balance                            at December                            31, 2005 |   |                                         | 160,000 |                                   | $      | 400,000                                   |   |                                   | 752,262,441 |                          | $      | 752,262         |   | $         | 2,185    |   | $ | (1,471,088 | ) | $ | (316,641 | ) |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Balance                            at January 1, 2006                              |   |                                         | 160,000 |                                   | $      | 400,000                                   |   |                                   | 752,262,441 |                          | $      | 752,262         |   | $         | 2,185    |   | $ | (1,471,088 | ) | $ | (316,641 | ) |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Stock                          issuance for Cash                                   |   |                                         | 166,000 |                                   |   | 415,000                                   |   |                                   | —     |                          |   | —         |   |      | —  |   |   | — |   |   | 415,000 |   |
| Loss                                                                               |   |                                         | — |                                   |   | —                                   |   |                                   | —     |                          |   | —         |   |      | —  |   |   | (264,756 | ) |   | (264,756 | ) |
|                                                                               |   |                                         |    |                                   |   |                                      |   |                                   |        |                          |   |            |   |      |     |   |   |   |   |   |   |   |
| Balance                            at June 30, 2006                                |   |                                         | 326,000 |                                   | $      | 815,000                                   |   |                                   | 752,262,441 |                          | $      | 752,262         |   | $         | 2,185    |   | $ | (1,735,844 | ) | $ | (166,397 | ) |

----

**FALCON                  RIDGE DEVELOPMENT, INC.**

**(FORMERLY                  POCKETSPEC TECHNOLOGIES, INC.)**

**STATEMENT                  OF CASH FLOWS**

**(Unaudited)**

|                                                                         |   | **Period                            Ended** |     |
|------------------------------------------------------------------------------|--------|---------------------------------------------|----------|
|                                                                         |   | **June                            30**      |     |
|                                                                         |   | **2006**                                    |     | **2005** |   |
| Cash                            flows from operating activities:             |   |                                        |     |   |   |
| Net                            income/loss                                   |   | $                                           | (264,756 | ) | $ | 371,759 |   |
| Adjustments                            to reconcile net loss to net cash     |   |                                        |     |   |   |   |   |
| used                            by operating activities:                     |   |                                        |     |   |   |   |   |
| Depreciation                                                                 |   |                                        | 2,100    |   |   | — |   |
| Changes                            in operating assets and liabilities,      |   |                                        |     |   |   |   |   |
| excluding                            effects of business combinations:       |   |                                        |     |   |   |   |   |
| Land                            development costs                            |   |                                        | (253,599 | ) |   | 3,523,422 |   |
| Prepaid                            expenses                                  |   |                                        | 13,540   |   |   | — |   |
| Other                            current assets                              |   |                                        | —  |   |   | 45,461 |   |
| Acquisition                            and development notes                 |   |                                        | —  |   |   | (3,868,625 | ) |
| Accounts                            payable                                  |   |                                        | (211,673 | ) |   | (344,920 | ) |
| Deferred                            revenue                                  |   |                                        | —  |   |   | (138,000 | ) |
| Net                            cash (used in) provided by               |   |                                        |     |   |   |   |   |
|  operating                            activities                        |   |                                        | (714,388 | ) |   | (410,903 | ) |
|                                                                         |   |                                        |     |   |   |   |   |
| Cash                            flows from investing activities:             |   |                                        |     |   |   |   |   |
|                                                                         |   |                                        |     |   |   |   |   |
| Acquisition                            of fixed assets                       |   |                                        | (6,319   | ) |   | (7,577 | ) |
|                                                                         |   |                                        |     |   |   |   |   |
| Net                            cash used in                             |   |                                        |     |   |   |   |   |
|  investing                            activities                        |   |                                        | (6,319   | ) |   | (7,577 | ) |
|                                                                         |   |                                        |     |   |   |   |   |
| Cash                            flows from financing activities:             |   |                                        |     |   |   |   |   |
| Decrease                            in related party indebtedness            |   |                                        | (88,966  | ) |   | 416,000 |   |
| Proceeds                            from acquisition and development notes   |   |                                        |     |   |   | 430,822 |   |
| Repayments                            of acquisition and development notes   |   |                                        |     |   |   | (416,558 | ) |
| Repayments                            of real estate contract                |   |                                        | (9,218   | ) |   | — |   |
| Proceeds                            from preferred shares                    |   |                                        | 415,000  |   |   | — |   |
| Dividend                            paid                                     |   |                                        | —  |   |   | (30,000 | ) |
| Net                            cash used in                             |   |                                        |     |   |   |   |   |
|  financing                            activities                        |   |                                        | 316,816  |   |   | 400,264 |   |
|                                                                         |   |                                        |     |   |   |   |   |
|                                                                         |   |                                        |     |   |   |   |   |
| Net                            change in cash                           |   |                                        | (403,891 | ) |   | (18,216 | ) |
|                                                                         |   |                                        |     |   |   |   |   |
| Cash:                                                                        |   |                                        |     |   |   |   |   |
| Beginning                            of period                               |   |                                        | 468,069  |   |   | 158,834 |   |
|                                                                         |   |                                        |     |   |   |   |   |
| End                            period                                        |   | $                                           | 64,178   |   | $ | 140,618 |   |
|                                                                         |   |                                        |     |   |   |   |   |
|                                                                         |   |                                        |     |   |   |   |   |
| Supplemental                            disclosure of cash flow information: |   |                                        |     |   |   |   |   |
| Cash                            paid during the year for:                    |   |                                        |     |   |   |   |   |
| Income                            taxes                                      |   | $                                           | —  |   | $ | — |   |
| Interest                                                                     |   | $                                           | 11,682   |   | $ | 76,256 |   |

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

| Note                      payable to Karen Duran, interest at 12%, principal and interest                      payable in                      annual installments of $17,000 |   |   |      |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|
| Total                      financing under the agreement is $200,000                                                                                                          |   | $      | 191,000   |   |
|                                                                                                                                                                          |   |   |      |   |
| Note                      payable to Karen Duran, interest at 8.5%, principal                      and interest payable May 25,2007                                           |   |   |      |   |
| Total                      financing under the agreement is $150,000                                                                                                          |   |   | 150,000   |   |
|                                                                                                                                                                          |   |   |      |   |
| Advances                      payable to Falcon Ridge Development LLC, an affiliate, payable                      on                      demand                              |   |   | 628,099   |   |
|                                                                                                                                                                          |   |   |      |   |
| Accrued                      interest payable                                                                                                                                 |   |   | 33,276    |   |
|                                                                                                                                                                          |   |   |      |   |
|                                                                                                                                                                          |   | $      | 1,002,375 |   |
|                                                                                                                                                                          |   |   |      |   |

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

|      |   | Cost   |   | Accumulated                    Depreciation |   |
|-----------|--------|--------|--------|---------------------------------------------|--------|
|      |   |   |   |                                        |   |
| Software  |   | $      | 32,349 |                                        | $      | 1,302 |   |
| Equipment |   |   | 7,981  |                                        |   | 1,596 |   |
|      |   |   |   |                                        |   |   |   |
|      |   | $      | 40,330 |                                        | $      | 2,898 |   |
|      |   |   |   |                                        |   |   |   |

| Land                    acquisition costs |   | $      | 839,889   |   |
|-------------------------------------------|--------|--------|-----------|--------|
| Land                    development costs |   |   | 487,949   |   |
| Capitalized                    interest   |   |   | 100,590   |   |
|                                      |   |   |      |   |
|                                      |   | $      | 1,428,428 |   |

| Note                    payable to Toby and Mary Ann Cordova, with interest at 6.5 percent,                    principal and interest payable in semi-annual installments of                    $21,862,                    collateralized by a real estate contract |   |   |    |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|
| Total                    financing under the agreement is $435,000                                                                                                                                                                                                   |   | $      | 379,380 |   |

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

| U.S.                    statutory federal rate                                                           |   |   | 20.000  | %      |
|----------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|
| State                    income tax rate                                                                 |   |   | 4.80    | %      |
| Net                    operating loss for which no tax benefit is currently                    available |   |   | -24.800 | %      |
|                                                                                                     |   |   |    |   |
|                                                                                                     |   |   | 0.00    | %      |

|   | · | Shares                    are non-cumulative with a preference over common shares if and                    when a                    dividend is declared. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Shares                    are convertible into common stock at any time on the basis of                    100 common                    shares for 1 share of preferred stock. This conversion rate is                    subject to                    adjustments for forward or reverse splits or other capitalizations.                    The                    option was of no intrinsic benefit, at the commitment date, to                    the                    preferred shareholder. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**FALCON          RIDGE DEVELOPMENT, INC.**

**(FORMERLY          POCKETSPEC TECHNOLOGIES, INC.)**

**Notes          to Consolidated Financial Statements**

**(Unaudited)**

|   | · | Shares                    have a priority over common shares upon                    liquidation. |
|--------|--------|---------------------------------------------------------------------------------------------------|

|   | · | Shares                    are callable at any time by the Company at the original purchase                    price.                    The Preferred Shareholders will have thirty days thereafter to                    convert to                    common stock. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Shares                    are non-cumulative with a preference over common shares if and                    when a                    dividend is declared. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Investor                    will receive interest of 12% per annum payable monthly for a                    period of                    eighteen months from the date of                    purchase. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Shares                    are convertible into common stock at any time on the basis of                    75% of the                    average current bid price for the preceeding 20 days of the Company's                    receipt of notice to convert. This conversion rate is subject                    to                    adjustments for forward or reverse splits or other capitalizations.                    The                    option was of no intrinsic benefit, at the commitment date, to                    the                    preferred shareholder. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Shares                    have a priority over common shares upon                    liquidation. |
|--------|--------|---------------------------------------------------------------------------------------------------|

|   | · | Shares                    are callable by the Company at any time after 12 months of issuance                    of                    Preferred B shares at the original purchase price. The Preferred                    Shareholders will have sixty days thereafter to convert to common                    stock. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**ITEM          2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF          OPERATION.**

----

----

----

----

**ITEM          3. CONTROLS AND PROCEDURES**

----

**PART          II. OTHER INFORMATION**

**ITEM          1. LEGAL PROCEEDINGS**

**ITEM          2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF          PROCEEDS.**

**ITEM          3. DEFAULTS UPON SENIOR SECURITIES**

**ITEM          4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**

**ITEM          5. OTHER INFORMATION**

----

**ITEM          6. EXHIBITS AND REPORTS ON FORM 8-K**

| **Exhibit****No.** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.1                |   | Agreement                    and Plan of Reorganization - Pocketspec Technologies, Inc. and                    Sierra                    Norte LLC (a)                                                                                                                                                                                                                                                                                                                                              |
| 2.2                |   | Acquisition                    Agreement - Pocketspec Technologies, Inc. and Spanish Trails,                    LLC                    (b)                                                                                                                                                                                                                                                                                                                                                          |
| 3.1                |   | Articles                    of Incorporation of Falcon Ridge Development, Inc. previously                    filed.                                                                                                                                                                                                                                                                                                                                                                                 |
| 3.2                |   | Bylaws                    of Falcon Ridge Development, Inc. previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 3.3                |   | Articles                    of Organization of Sierra Norte, LLC previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3.4                |   | Operating                    Agreement of Sierra Norte, LLC previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 3.5                |   | Articles                    of Organization of Spanish Trails, LLC previously                    filed.                                                                                                                                                                                                                                                                                                                                                                                             |
| 3.6                |   | Operating                    Agreement of Spanish Trails, LLC previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                     |
| 4.1                |   | Articles                    of Amendment - Establishment of Series of Preferred Stock previously                    filed.                                                                                                                                                                                                                                                                                                                                                                          |
| 10.1               |   | Purchase                    Agreement - Spanish Trails, LLC and D.R. Horton* (Confidential                    portions of                    this agreement noted by *** have been omitted and filed separately                    with                    the Securities and Exchange Commission pursuant to a request                    for                    confidentiality under Rule 24b-2 of the Securities Exchange Act                    of 1934.)                    Previously filed. |
| 10.2               |   | Promissory                    Note - Karen Y. Duran - Sierra Norte, LLC - May 20, 2005 - $150,000                    previously filed.                                                                                                                                                                                                                                                                                                                                                              |
| 10.3               |   | Promissory                    Note - Karen Y. Duran - Sierra Norte, LLC - June 1, 2005 - $200,000                    previously filed.                                                                                                                                                                                                                                                                                                                                                              |
| 10.4               |   | Promissory                    Note - Karen Y. Duran - Sierra Norte, LLC - June 19, 2005 - $66,000                    previously filed.                                                                                                                                                                                                                                                                                                                                                              |
| 14.1               |   | Code                    of Ethics previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 21.1               |   | List                    of Subsidiaries previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 23.1               |   | Consents                    of experts                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.1               |   | Certification                    of Chief Executive Officer pursuant to Rule                    13a-14(a)/15(d)-14(a)*                                                                                                                                                                                                                                                                                                                                                                              |
| 31.2               |   | Certification                    of Chief Financial Officer pursuant to Rule                    13a-14(a)/15(d)-14(a)*                                                                                                                                                                                                                                                                                                                                                                              |
| 32.1               |   | Certification                    of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,                    as adopted                    pursuant to Section 906 of the Sarbanes-Oxley Act of                    2002*                                                                                                                                                                                                                                                                      |
| 32.2               |   | Certification                    of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,                    as adopted                    pursuant to Section 906 of the Sarbanes-Oxley Act of                    2002*                                                                                                                                                                                                                                                                      |
| 99                 |   | Additional                    Exhibits - None                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

|   | (a) | Filed                    on May 25, 2005 as Exhibit 2.1 with the Registrant's Current                    Report on                    Form 8-K and incorporated herein by                    reference. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Filed                    on July 8, 2005 as Exhibit 10.19 with the Registrant's Current                    Report on                    Form 8-K and incorporated herein by                    reference. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | b. | Reports                    on Form 8-K |
|--------|----|----------------------------------------|

----

**SIGNATURES**

|                                                         |   | Falcon                    Ridge Development, Inc.                        |
|--------------------------------------------------------------|--------|--------------------------------------------------------------------------|
| Dated:                    August                    14, 2006 | By:    | /s/                    Fred M. Montano                                   |
|                                                         |   | Fred                    M. Montano                                       |
|                                                         |   | President,                    Chief Executive Officer, and Director      |
|                                                         |   |                                                                     |
| Dated:                    August                    14, 2006 | By:    | /s/                    Karen Y. Duran                                    |
|                                                         |   | Karen                    Y. Duran                                        |
|                                                         |   | Vice                    President, Treasurer and Chief Financial Officer |
|                                                         |   |                                                                     |
|                                                         |   |                                                                     |

----

**EXHIBIT          INDEX**

| **Exhibit****No.** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.1                |   | Agreement                    and Plan of Reorganization - Pocketspec Technologies, Inc. and                    Sierra                    Norte LLC (a)                                                                                                                                                                                                                                                                                                                                              |
| 2.2                |   | Acquisition                    Agreement - Pocketspec Technologies, Inc. and Spanish Trails,                    LLC                    (b)                                                                                                                                                                                                                                                                                                                                                          |
| 3.1                |   | Articles                    of Incorporation of Falcon Ridge Development, Inc. previously                    filed.                                                                                                                                                                                                                                                                                                                                                                                 |
| 3.2                |   | Bylaws                    of Falcon Ridge Development, Inc. previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 3.3                |   | Articles                    of Organization of Sierra Norte, LLC previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3.4                |   | Operating                    Agreement of Sierra Norte, LLC previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 3.5                |   | Articles                    of Organization of Spanish Trails, LLC previously                    filed.                                                                                                                                                                                                                                                                                                                                                                                             |
| 3.6                |   | Operating                    Agreement of Spanish Trails, LLC previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                     |
| 4.1                |   | Articles                    of Amendment - Establishment of Series of Preferred Stock previously                    filed.                                                                                                                                                                                                                                                                                                                                                                          |
| 10.1               |   | Purchase                    Agreement - Spanish Trails, LLC and D.R. Horton* (Confidential                    portions of                    this agreement noted by *** have been omitted and filed separately                    with                    the Securities and Exchange Commission pursuant to a request                    for                    confidentiality under Rule 24b-2 of the Securities Exchange Act                    of 1934.)                    Previously filed. |
| 10.2               |   | Promissory                    Note - Karen Y. Duran - Sierra Norte, LLC - May 20, 2005 - $150,000                    previously filed.                                                                                                                                                                                                                                                                                                                                                              |
| 10.3               |   | Promissory                    Note - Karen Y. Duran - Sierra Norte, LLC - June 1, 2005 - $200,000                    previously filed.                                                                                                                                                                                                                                                                                                                                                              |
| 10.4               |   | Promissory                    Note - Karen Y. Duran - Sierra Norte, LLC - June 19, 2005 - $66,000                    previously filed.                                                                                                                                                                                                                                                                                                                                                              |
| 14.1               |   | Code                    of Ethics previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 21.1               |   | List                    of Subsidiaries previously filed.                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 23.1               |   | Consents                    of experts                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.1               |   | Certification                    of Chief Executive Officer pursuant to Rule                    13a-14(a)/15(d)-14(a)*                                                                                                                                                                                                                                                                                                                                                                              |
| 31.2               |   | Certification                    of Chief Financial Officer pursuant to Rule                    13a-14(a)/15(d)-14(a)*                                                                                                                                                                                                                                                                                                                                                                              |
| 32.1               |   | Certification                    of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,                    as adopted                    pursuant to Section 906 of the Sarbanes-Oxley Act of                    2002*                                                                                                                                                                                                                                                                      |
| 32.2               |   | Certification                    of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,                    as adopted                    pursuant to Section 906 of the Sarbanes-Oxley Act of                    2002*                                                                                                                                                                                                                                                                      |
| 99                 |   | Additional                    Exhibits - None                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

----

----

----

**CERTIFICATIONS**

| 1. | I                    have reviewed the report being filed on Form 10-QSB by Falcon                    Ridge                    Development Inc.; |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | Based                    on my knowledge, the report does not contain any untrue statement                    of a                    material fact or omit to state a material fact necessary to make                    the                    statements made, in light of the circumstances under which such                    statements                    were made, not misleading with respect to the period covered                    by the                    report; |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | Based                    on my knowledge, the financial statements, and other financial                    information                    included in the report, fairly present in all material respects                    the                    financial condition, results of operations and cash flows of                    Falcon Ridge                    Development Inc. as of, and for, the periods presented in the                    report; |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | I                    and the other certifying officer are responsible for establishing                    and                    maintaining disclosure controls and procedures (as such term                    is defined in                    Regulation 13a-14 of the Securities Exchange Act of 1934) for                    Falcon Ridge                    Development Inc. and have: |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | i. | Designed                    such disclosure controls and procedures to ensure that material                    information relating to Falcon Ridge Development Inc., including                    its                    consolidated subsidiaries, is made known to us by others within                    those                    entities, particularly during the period in which the periodic                    reports are                    being prepared; |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii. | Evaluated                    the effectiveness of Falcon Ridge Development Inc.'s disclosure                    controls                    and procedures as of a date within 90 days prior to the filing                    date of the                    report ("Evaluation Date"); and |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iii. | Presented                    in the report our conclusions about the effectiveness of the                    disclosure                    controls and procedures based on our evaluation as of the Evaluation                    Date; |
|--------|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | I                    and the other certifying officer have disclosed, based on our                    most recent                    evaluation, to the Falcon Ridge Development Inc. auditors and                    the audit                    committee of the board of directors (or persons fulfilling the                    equivalent                    function): |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | i. | All                    significant deficiencies in the design or operation of internal                    controls                    which could adversely affect Falcon Ridge Development Inc.'s                    ability to                    record, process, summarize and report financial data and have                    identified                    Falcon Ridge Development Inc.'s auditors any material weaknesses                    in                    internal controls; and |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii. | Any                    fraud, whether or not material, that involves management or other                    employees who have a significant role in the issuer's internalcontrols;                    and |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6. | I                    and the other certifying officer have indicated in the report                    whether or                    not there were significant changes in internal controls or in                    other                    factors that could significantly affect internal controls subsequent                    to                    the date of our most recent evaluation, including any corrective                    actions                    with regard to significant deficiencies and material                    weaknesses. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Date:                    August 14, 2006 |   | /s/                    Fred M. Montano                      |
|------------------------------------------|--------|-------------------------------------------------------------|
|                                     |   | Fred                    M. Montano, Chief Executive Officer |

----

----

----

----

**CERTIFICATIONS**

|   | 1. | I                    have reviewed the report being filed on Form 10-QSB by Falcon                    Ridge                    Development Inc.; |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2. | Based                    on my knowledge, the report does not contain any untrue statement                    of a                    material fact or omit to state a material fact necessary to make                    the                    statements made, in light of the circumstances under which such                    statements                    were made, not misleading with respect to the period covered                    by the                    report; |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. | Based                    on my knowledge, the financial statements, and other financial                    information                    included in the report, fairly present in all material respects                    the                    financial condition, results of operations and cash flows of                    Falcon Ridge                    Development Inc. as of, and for, the periods presented in the                    report; |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. | I                    and the other certifying officer are responsible for establishing                    and                    maintaining disclosure controls and procedures (as such term                    is defined in                    Regulation 13a-14 of the Securities Exchange Act of 1934) for                    Falcon Ridge                    Development Inc. and have: |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | i. | Designed                    such disclosure controls and procedures to ensure that material                    information relating to Falcon Ridge Development Inc., including                    its                    consolidated subsidiaries, is made known to us by others within                    those                    entities, particularly during the period in which the periodic                    reports are                    being prepared; |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii. | Evaluated                    the effectiveness of Falcon Ridge Development Inc.'s disclosure                    controls                    and procedures as of a date within 90 days prior to the filing                    date of the                    report ("Evaluation Date"); and |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iii. | Presented                    in the report our conclusions about the effectiveness of the                    disclosure                    controls and procedures based on our evaluation as of the Evaluation                    Date; |
|--------|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5. | I                    and the other certifying officer have disclosed, based on our                    most recent                    evaluation, to the Falcon Ridge Development Inc. auditors and                    the audit                    committee of the board of directors (or persons fulfilling the                    equivalent                    function): |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 6. | All                    significant deficiencies in the design or operation of internal                    controls                    which could adversely affect Falcon Ridge Development Inc.'s                    ability to                    record, process, summarize and report financial data and have                    identified                    Falcon Ridge Development Inc.'s auditors any material weaknesses                    in                    internal controls; and |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | i. | Any                    fraud, whether or not material, that involves management or other                    employees who have a significant role in the issuer's internalcontrols;                    and |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii. | I                    and the other certifying officer have indicated in the report                    whether or                    not there were significant changes in internal controls or in                    other                    factors that could significantly affect internal controls subsequent                    to                    the date of our most recent evaluation, including any corrective                    actions                    with regard to significant deficiencies and material                    weaknesses. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Date:                    August 14, 2006 |   | /s/                    Karen Y. Duran                      |
|------------------------------------------|--------|------------------------------------------------------------|
|                                     |   | Karen                    Y. Duran, Chief Financial Officer |

----

----

----

----

**CERTIFICATION          PURSUANT TO**

**18          U.S.C. SECTION 1350,**

**AS          ADOPTED PURSUANT TO**

**SECTION          906 OF THE SARBANES-OXLEY ACT OF 2004**

| Date:                    August 14, 2006 |   | /s/                    Fred M. Montano                      |
|------------------------------------------|--------|-------------------------------------------------------------|
|                                     |   | Fred                    M. Montano, Chief Executive Officer |

----

----

**CERTIFICATION          PURSUANT TO**

**18          U.S.C. SECTION 1350,**

**AS          ADOPTED PURSUANT TO**

**SECTION          906 OF THE SARBANES-OXLEY ACT OF 2004**

| Date:                    August 14, 2006 |   | /s/                    Karen Y. Duran                      |
|------------------------------------------|--------|------------------------------------------------------------|
|                                     |   | Karen                    Y. Duran, Chief Financial Officer |